Throw some more skirt on the barbie

18 July 2017

A combination of increased supply, easing prices and firm in-market demand from the Yakiniku sector (Japanese BBQ) has seen skirt exports to Japan lift in June.

Australian eastern states weekly cattle kill surpassed year-ago levels for the first time this year in late June and has since remained above 2016 levels, with 136,000 head processed last week. Dry conditions across many key supply regions has seen increased turn-off.

As a result, traders have been procuring larger quantities of skirt (particularly thin skirt). Volumes of skirt to Japan lifted 7% from last June, totalling 808 tonnes swt for the month. This increase was off the back of limited availability earlier in the year and continuing demand from the Yakiniku sector.

The rise in June was not enough to offset the decline in the fiscal year total, however. In 2016-17, skirt shipments remained 12% below 2015-16 levels, at 7,200 tonnes swt.

The weight of higher supplies has put some downward pressure on prices. As reported in the most recent MLA co-products report, thick skirt fell $3.52/kg year-on-year and was 38¢/kg weaker month-on-month, averaging $6.30/kg in June. Meanwhile thin skirt averaged $6.30/kg, falling $4.08/kg from very strong year-ago levels and was 97¢/kg lower than the previous month.